Risk appetite remains muted, with Bitcoin derivatives open interest stuck in a narrow range and capital instead flowing toward gold.
Stablecoin supply has continued to shrink over the past week, coinciding with Bitcoin’s extended drop that began two weeks ago.
The combined market capitalization of the top 12 stablecoins has shed roughly $2.24 billion over the past 10 days, according to on-chain analytics platform Santiment. The outflow has tracked Bitcoin’s decline from $95,000 to $88,441, per CoinGecko.
Bitcoin is up 1.4% on the day to $88,500 but remains down 4.2% on the week.
“Normally, when traders sell Bitcoin or altcoins, that money stays in crypto as stablecoins. A falling stablecoin market cap shows that many investors are cashing out to fiat instead of preparing to buy dips,” Santiment added.
The capital drain is visible across derivatives markets, with Bitcoin’s aggregated open interest — the total number of open positions — has remained rangebound between 2450,000 and 267,000 BTC for weeks, per Velo data.
What’s driving capital outflows?
Two primary forces are at work: Bitcoin’s historical performance during macro stress and a classic flight to a more established safe haven, gold.
Bitcoin’s bearish behavior during periods of macroeconomic uncertainty is a well-established pattern, Jordan Jefferson, founder of the Dogecoin app layer DogeOS, previously told Decrypt.
The current downtrend from the October all-time high, driven by shifting geopolitics and policy uncertainty, is “consistent with that pattern,” he said.
“Gold is backed by thousands of years of credibility and low volatility,” Tim Sun, senior researcher at HashKey Group, told Decrypt. Its steady ascent to a new record high of $5,100 per ounce this week underscores this advantage.
Bitcoin, in contrast, remains sidelined.
“High volatility makes it difficult to absorb such large-scale safe-haven demand,” Sun said. The asset’s investor base compounds the issue, as global wealth is concentrated in individuals over 50 whose trust in gold has been validated through repeated crises.
For them, Sun said, Bitcoin”may still be perceived as a high-risk tech asset or a game for younger generations.”
